Monday Watch

Today's Headlines

Bloomberg:   

• Xi’s Leading China Toward Stagnation.  

• Visa(V) and Mastercard’s(MA) Chinese Entry Delayed by Central Bank: FT.

• Labour Vows Confidence Vote as May Faces Defeat on Brexit Deal.

• Italy Finance Minister Sees Economy in Stagnation, Not Recession.   

• ECB's Nowotny Urges Caution on Rate Increases as Growth Slows.

• Viacom in Talks to Sell Majority Stake in China Operations: WSJ.

• Traders Suddenly Dare to Believe in an Emerging-Market Rally.

• Asian Stocks to Start Mixed With Earnings in Focus. Asian stocks were poised for a mixed start on Monday, following the best week for regional stocks since the start of November, as investors awaited a raft of earnings and trade data from China. The yuan held recent gains. Futures indicated a small decline when equity trading begins in Hong Kong and Australia’s main index fluctuated at the open. Japan is closed for a holiday, so Treasuries won’t trade until the London open. U.S. equity futures slipped after the S&P 500 on Friday closed flat and the yield on 10-year Treasuries declined. Futures on Hong Kong’s Hang Seng slid 0.2 percent. Australia’s S&P/ASX 200 Index added 0.1 percent. Futures on the S&P 500 slid 0.3 percent.

• Five Things You Need to Know to Start Your Day.  

• U.S. Recession Warning Signs, China's 2019 To-Do List: Eco Day.

• Saudis Say OPEC+ Oil Cuts on ‘Right Track’ to Balance the Market.

• Bill Gross's Bond-Fund Assets Decline Below $1 Billion.

• FedEx(FDX) Tests Adding Full-Service Home Delivery of Bulky Goods.

Wall Street Journal: 

• GOP Senator Pushes Temporary Deal to Open Government.

• White House Sought Options to Strike Iran.

• Border Wall Impasse Frustrates Many New House Democrats.

• Slow Earnings Growth, Dim Forecasts Weigh on Stocks.

• California’s Next Ban: Paper Receipts.

MarketWatch.com:

• Tech finds a middle lane for autonomous cars at CES.

• This popular stock-market checklist from Citi says the bull is alive and well.

Fox News:

• Sarah Sanders, RNC chair McDaniel slam lawmakers for Puerto Rico trip as shutdown rolls on.

• FOX NEWS EXCLUSIVE: Trump says he did not hide details of Putin talk.

• Republican says his Comey questions uncovered FBI investigation of Trump.

CNBC:

• Currency chart points to bullish activity in stocks, oil.

• The ten hottest cars debuting at the Detroit auto show.

• Early research on Apple’s Health Records service suggests patients generally like it. 

• Saudi energy minister: Russia moving ‘slower than I’d like’ on oil cuts.

Zero Hedge:  

• Trump "Couldn't Care Less" If Putin Conversation Becomes Public; Slams "Most Insulting Article" By NYT.

• As FBI Ramped Up "Witch Hunt" When Trump Fired Comey, Strzok Admitted Collusion Investigation A Joke.

• Trump Threatens To "Devastate Turkey Economically" If Kurds Attacked, Sends Lira Sliding.

• Illinois Is "National Outlier" When It Comes To Losing Residents.   

• The Shutdown Is Providing Evidence Of Private Businesses Making Government Obsolete.

• Fake News? How About No News?

• US Electric Grid Hacked: Perpetrators Could Have Shut Down The System.

• Theresa May Could Be Removed As Soon As Wednesday If Vote On Brexit Deal Fails.

• Real Tax Rates In The 60s Were Much Lower Than Ocasio-Cortez Thinks.

• Trump: "I Haven't Left The White House Since The Shutdown Began".

• Furloughed Federal Employees Are Still Paid More Than You.

• "China's Nightmare": B-2 Stealth Bombers Deployed To Hawaii, "On Watch" 24/7.

• Political Nightmares Multiply For Europe Ahead Of Davos.

• Model Reveals Diet Secrets Of The Insta-Fabulous: "Tapas And Cocaine".

• Chinese Super Soldiers Are Using These Futuristic Weapons. 

Business Insider:

• Pakistan abruptly stopped calling out China's mass oppression of Muslims. Critics say Beijing bought its silence.

• Bed Bath & Beyond's(BBBY) stores have been called 'a mess,' but the chain might be starting to turn that around. 

• Microsoft President Brad Smith says these are the 10 biggest challenges facing tech in 2019.  

• A drug that works differently from all existing depression drugs just got a big boost.

• The future of artificial intelligence in retail.

Telegraph:

• Germany flirts with recession, but Italy and France will bear the brunt.

Night Trading

• Asian indices are -.25% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 89.50 +.25 basis point.

• China Sovereign CDS 61.5 -1.75 basis points.

• Bloomberg Emerging Markets Currency Index 67.88 -.05%.

• FTSE 100 futures -.22%.

• S&P 500 futures -.45%.

• NASDAQ 100 futures -.49%.

Morning Preview Links

Earnings of Note

Company/Estimate
Before the Open:

• (C)/1.55

• (SJR)/.31

After the Close:

• None of note

Economic Releases

• None of note

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The China Trade Balance report, Deutsche Bank China Conference and the (AEO) business update could also impact trading today.

BOTTOM LINE: Asian indices are slightly lower, weighed down by financial and consumer shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed.  The Portfolio is 75% net long heading into the week.